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1. (TCO 4) Yield to maturity takes into account everything except (Points : 4) annual interest received.
the difference between the current bond price and its maturity value.
the number of years to maturity.
the number of years since the bond’s purchase.
| Question 2. 2. (TCO 4) Duration equals maturity if (Points : 4) |
all cash flows are paid at the end of the year.
the coupon rate equals the market rate.
the bond is a zero-coupon bond.
More than one of the above |
| Question 3. 3. (TCO 5) Warrants are considered to be highly speculative because (Points : 4) |
they are attached to the bond issue.
they have a short life and their value is magnified by movements in the stock price.
the intrinsic value is highly volatile.
ownership of warrants provides no dividends or interest. |
| Question 4. 4. (TCO 5) _____ is a factor that causes the speculative premium to increase. (Points : 4) |
Volatility of the underlying stock as measured by beta
Low dividend yield
A long exercise period
All of the above |
| Question 5. 5. (TCO 5) In what city are the two largest commodities exchanges? (Points : 4) |
Chicago
New York
Kansas City
Minneapolis |
| Question 6. 6. (TCO 5) The primary use of stock index futures by the portfolio manager is (Points : 4) |
to offset the loss on the portfolio in a declining market.
to profit from major market movements.
to increase the profit potential on the portfolio.
All of the above |
| Question 7. 7. (TCO 6) The difference between a load fund and a no-load fund is that (Points : 4) |
no-load funds do not charge commissions and are sold directly by the investment company.
load funds do not charge commissions and are sold directly by the investment company.
no-load funds charge higher commissions than load funds.
no-load funds charge lower commissions than load funds. |
| Question 8. 8. (TCO 6) Political risk can best be effectively reduced or eliminated (Points : 4) |
by investing only in European countries.
through sufficient international diversification.
by investing only in countries friendly to the United States.
All of the above |
| Question 9. 9. (TCO 6) Real estate is a particularly good investment among real assets because of (Points : 4) |
depreciation write-offs.
appreciation in value due to price appreciation.
long-term financing.
All of the above |
| Question 10. 10. (TCO 7) If you took all the possible investments that investors could acquire and determined the optimum basket of investments, you would come up with point _____ on the capital market line. (Points : 4) |
RF
K
M
Z1. (TCO 4) Yield to maturity takes into account everything except (Points : 4) annual interest received.
the difference between the current bond price and its maturity value.
the number of years to maturity.
the number of years since the bond’s purchase.
| Question 2. 2. (TCO 4) Duration equals maturity if (Points : 4) |
all cash flows are paid at the end of the year.
the coupon rate equals the market rate.
the bond is a zero-coupon bond.
More than one of the above |
| Question 3. 3. (TCO 5) Warrants are considered to be highly speculative because (Points : 4) |
they are attached to the bond issue.
they have a short life and their value is magnified by movements in the stock price.
the intrinsic value is highly volatile.
ownership of warrants provides no dividends or interest. |
| Question 4. 4. (TCO 5) _____ is a factor that causes the speculative premium to increase. (Points : 4) |
Volatility of the underlying stock as measured by beta
Low dividend yield
A long exercise period
All of the above |
| Question 5. 5. (TCO 5) In what city are the two largest commodities exchanges? (Points : 4) |
Chicago
New York
Kansas City
Minneapolis |
| Question 6. 6. (TCO 5) The primary use of stock index futures by the portfolio manager is (Points : 4) |
to offset the loss on the portfolio in a declining market.
to profit from major market movements.
to increase the profit potential on the portfolio.
All of the above |
| Question 7. 7. (TCO 6) The difference between a load fund and a no-load fund is that (Points : 4) |
no-load funds do not charge commissions and are sold directly by the investment company.
load funds do not charge commissions and are sold directly by the investment company.
no-load funds charge higher commissions than load funds.
no-load funds charge lower commissions than load funds. |
| Question 8. 8. (TCO 6) Political risk can best be effectively reduced or eliminated (Points : 4) |
by investing only in European countries.
through sufficient international diversification.
by investing only in countries friendly to the United States.
All of the above |
| Question 9. 9. (TCO 6) Real estate is a particularly good investment among real assets because of (Points : 4) |
depreciation write-offs.
appreciation in value due to price appreciation.
long-term financing.
All of the above |
| Question 10. 10. (TCO 7) If you took all the possible investments that investors could acquire and determined the optimum basket of investments, you would come up with point _____ on the capital market line. (Points : 4) |
RF
K
M
Z |
|
